Autonomous Vehicles: Moral dilemmas and adoption incentives

In unavoidable traffic accidents, autonomous vehicles (AVs) face the dilemma of protecting either the passenger(s) or third parties. Recent studies show that, in accidents involving an AV, most people prefer the AV to behave such that it minimizes expected harm. At the same time, however, they are more willing to adopt an AV if it prioritizes the passenger(s), i.e. themselves. A regulator therefore needs to set a rather high level of driver protection in order to increase the market penetration of AVs. Using a game-theoretic model, we analyze how the second-best optimal level of AV passenger protection depends on (i) the AV safety advantage, (ii) the intensity of drivers’ other-regarding preferences, and (iii) the (preference) cost of AV adoption. We show that a higher AV safety advantage may either increase or decrease the second best optimal level of AV driver/passenger protection. In an extension, we find that increasing the degree of driver protection has the additional benefit of leading to higher care levels of other road users such as pedestrians and cyclists.